**1. Introduction**

Energy requirements of the world are increasing day by day since there is a constant increase in the world population. The main source of energy consumed is from oil, gas, and coal. The rate at which fossil fuels are utilized is alarming because the stock of fossil fuels is depleting at a higher rate, and after few years, fossil fuels become out of stock. Due to high demand, the fossil fuel energy cost is very high, and it becomes difficult to extract. Usage of fossil fuels creates problem to the environment and life of the livid hoods in earth. The combustion of oil, gas, and coal produces a pollutant gas which destroys the environment and also contributing to air pollution such as emission of nitrogen, sulfuric, carbon, hydrocarbon, and metal oxides. Oil spills and acid rain are the classical example of this polluted environment. The increase in demand for energy forces to find alliterative fuels has to utilize for green energy production. The best alternative and more suitable for this type of requirement is renewable energy sources. Renewable energy generation source is environment friendly and is available in abundant in nature. This source will not deplete, since the power is extracted from solar, fuel cells, wind, hydro, geothermal, and biomass. From renewable energy sources, energy is derived from direct and indirect way. Now-a-days due to advancement in technology efficiency of renewable energy source, sources improved and cost per unit is reduced. Most of the nations started investing in renewable energy power plants for long-term growth based on their energy growth requirements as shown in **Figure 1**. Since last few years, global investment on renewable energy sources exceeds four trillion billions and in is expected much more in coming years [1–5].

**Figure 1.** *Global investment in renewable energy in billions.*

**Figure 2.** *Microgrid and its components.*

With the increase in power demand and raise in the global warming plays a critical role in distributed renewable energy sources. Local generation sources such as wind, biomass, solar, microturbines, and fuel cells are the future renewable sources. Latest power grids have advantages like integration of green energy, scalability, and modularity supported by different renewable and non-renewable energy sources.

**105**

*Microgrid*

*DOI: http://dx.doi.org/10.5772/intechopen.88812*

university grids, army grids, and nanogrids [6–13].

**2. Technical challenges in microgrid**

ment as shown in **Figure 2**.

Microgrids are the latest evolving grid which effectively extract power and manage in the distributed energy sources. Microgrids are the future grids of the world. The components of microgrids are distributed energy sources such as PV cells, fuel cells, wind turbines, and mini hydro turbines. along with storage devices such as fly wheels, energy capacitors and batteries and diesel generators for peak load manage-

Microgrids are operated in two modes such as grid connected mode and islanded mode. Microgrids are low voltage grid which can be operated in autonomous state and non-autonomous state. The effective coordination of the components or sources involved in a microgrid will provide energy as minimum cost with high reliability in power supply. Microgrids are the classical example of smart grid applications. The data communications in all nodes of microgrids make the power management much more effective and accurate. Microgrids are low voltage, low power grids ranging from few kW to hundred kW. Based on the size of the load specifications and its applications, microgrids are called as mini grids, house grids,

The challenges related with the control and operations of microgrids are very high.

Microgrids are required to ensure the reliable operations even at fault conditions, power system stability during disturbances, and power quality in the island mode. The grid connected microgrid is needed to be maintained synchronism at any situations. Microgrids need to have advanced control strategies for microgrid inverters to maintain correct frequency and voltage to ensure stable operations for the power system connected with dynamically variable load. The growth of microgrids and its challenges has gained attention of researchers and various government and private organizations to play a vital role in finding out the solutions of effective implementation of microgrid. One of the major problems in microgrid is protection system in main grid and microgrid faults. When there is any fault in main grid protection, microgrid needs to be isolated immediately, and similarly if there is any fault in microgrid, the protection system should isolate the smallest part of the microgrid to clear the fault. The selectivity and sensitivity plays a vital role in low voltage microgrid power management. False tripping, unnecessary tripping, delayed tripping, and undetected faults are the major challenges in design of protection system in microgrids. The number of installation of distributed energy resources and availability of short-circuit current in the islanded mode of microgrid are the major issues while considering the protection of microgrids. Compared to main grid, the short-circuit current will drop down drastically and will give problem in the protection of microgrid. There is a need for designing a proper protection system for distributed energy resources with short-circuit calculations and placement of over current relays, reverse power relays, and directional over current relays. In real time, the operating conditions of microgrid are variable because of intermittent distributed sources and dynamic electrical load demand. This leads to change in network topology frequently to aim to minimize loss, economic load dispatch, and proper unit commitment with satisfying all the constraints. The directions and magnitudes of short circuit will vary because of these situations. The different sizing of equipment in various components of microgrid creates often a loss of relay coordination, and generic over current protection will become ineffective in protection of the microgrid from faults. The invention of new methodology in protection mechanism is very much needed to set different parameters for over current protection, parameters of relays, deal with low short circuit current, and

interfacing of power electronic devices with the microsources [14].
